Why the auto industry gained Wall Street favor in storm's wake

[Rayancaleb]

Hurricane Harvey did for the auto industry what record profits for automakers, rising volumes for auctions and increasing business for dealerships' highly profitable service-and-parts business had failed to do: Make Wall Street happy.

General Motors, Ford Motor Co., KAR Auction Services Inc. and the publicly traded dealership groups all had their stock prices jump last week in the wake of Harvey's devastation.

For full Harvey coverage from Automotive News, click here.

Put aside, if you can, the human cost of the disaster. I could say that being callous about human suffering is one of Wall Street's enduring characteristics, or I could say that Wall Street has a different set of values than you and I.

What the stock market cares about is business prospects several, often many, months away. And it liked what it saw in Harvey's path of destruction.

Maybe you saw families flooded out of the Houston homes. Cars swept off highways. Dealership lots that were inundated.

 

[DeltaRisk]

This will be bad.
I have interests in dealerships.
Capps is cutting off credit, Lobel is too.

This is going to be the blame for the collapse.

 

[JackRab]

Hurricane Harvey did for the auto industry what record profits for automakers, rising volumes for auctions and increasing business for dealerships' highly profitable service-and-parts business had failed to do: Make Wall Street happy.

General Motors, Ford Motor Co., KAR Auction Services Inc. and the publicly traded dealership groups all had their stock prices jump last week in the wake of Harvey's devastation.

For full Harvey coverage from Automotive News, click here.

Put aside, if you can, the human cost of the disaster. I could say that being callous about human suffering is one of Wall Street's enduring characteristics, or I could say that Wall Street has a different set of values than you and I.

What the stock market cares about is business prospects several, often many, months away. And it liked what it saw in Harvey's path of destruction.

Maybe you saw families flooded out of the Houston homes. Cars swept off highways. Dealership lots that were inundated.

Nice copy paste work... you could've just linked to the article instead.

 

[JackRab]

This will be bad.
I have interests in dealerships.
Capps is cutting off credit, Lobel is too.

This is going to be the blame for the collapse.

I thought dealerships are mainly funded by the manufacturers?

Most damage should be covered by insurance... so what's the problem? People will need new cars, so that will boost sales. Drop stock levels... possibly increase prices for 2nd hand vehicles not affected...

 

[DeltaRisk]

I thought dealerships are mainly funded by the manufacturers?

Most damage should be covered by insurance... so what's the problem? People will need new cars, so that will boost sales. Drop stock levels... possibly increase prices for 2nd hand vehicles not affected...

The idiots are overbidding for cars.
Think of a diamond, if it's value is 3k, who in their right mind would pay 6k for it?
As a professional, that is insane.

It's not impossible and not expensive to have cars shipped over here, but these guys are basically killing their buisness by purchasing vehicles that are damaged.
Dealers mainly use Autofax or AutoCheck, not Carfax.
I go to Manheim auctions, it's an incredible show of idiocracy. CarMax is probably the worst, over bidding and not to mention the buyers cannot figure out a vehicle is bad.
Right now, you've got all of these green lighted cars that shouldn't be cleared going through auctions and these other dealers cannot figure it out. The hurricane vehicles are coming through, and aren't labeled damaged. Who'd of thought?

My buyer is instructed, but car dealerships can give you so many many headaches.